Category Archives: regulation

Job Cut Worries

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The Left has them in the Department of Education.  It seems that the DoEd is sharply cutting back staff in its Office for Civil Rights.

[C]ritics say the move will blunt the office’s response to issues like sexual assault on college campuses and racial discrimination in public schools.

And

Some civil rights advocates are…saying the buyouts [to encourage departure] are determined by department chiefs who they say are targeting the civil rights office.

I certainly hope so.

Law enforcement and crime, including sexual assault, are matters for the police and the DoJ.  DoJ also has its own civil rights section. DoEd has—or should have—nothing to say on these matters.

The duplication needs to be eliminated altogether, and not just with a few job cuts.  All of the should be jobs cut, and DoEd’s Office of Civil Rights should be completely eliminated.

Good for Workers, Good for Business

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Recall the National Labor Relations Board’s case of a couple of years ago, Browning-Ferris Industries.

Browning-Ferris concerned a recycling center staffed by contractors. The original [NLRB] ruling found the contractors were jointly employed by a staffing firm and Browning-Ferris.

This ruling, if allowed to stand (the case also is in the Federal court system) would have allowed contractors like those at Browning-Ferris, McDonald’s, and any other franchise-centered corporation not only to form unions at individual franchises (which they’ve always been able to do), but also to form a grand union across the corporation.

President Donald Trump appointed a couple of folks to the NLRB to fill vacancies created when two ex-President Barack Obama (D) appointees quit in a snit over Trump’s election.  Now the NLRB has voted to overturn that prior NLRB ruling.

This is good for both business and for employees.  It’s good for business because modern unions have devolved into extortion rackets that threaten a business’ ability to exist through crippling strikes unless the unions get pay and benefits that they demand, even when those things cost more in their per-employee aggregate than the employee’s work is worth.

It’s good for the workers because it means, with labor costs allowed to match the value of the work done, labor won’t be replaced by automation that’s cheaper than the union-elevated labor costs.  Jobs will be preserved, and more hiring will occur.  It’s also good for workers because it frees them to negotiate their own wage and benefit package instead of being dragooned into whatever a union might impose on them.

The Question is a Non Sequitur

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John McKinnon and Brent Kendall, in their Wall Street Journal piece, asked Is FTC Up to the Task of Internet Regulation?

His piece is about the split between what the FCC (the erstwhile “regulator” of the Internet, courtesy of the Obama administration) and the FTC are qualified to regulate.

The question is a bit of a non sequitur, though. The Internet is merely a transport medium, and it needs very little regulation. The FTC is fully up to the task of regulating (ideally with a similarly light touch) trade, which is independent of the medium—highway, railroad, snail mail, or electronic—over which the traded products are transported.

And: lightly regulated commerce is highly conducive to innovation.  Just look at our communications system since the breakup and deregulation of Ma Bell.  And the Internet between its inception and the Obama FCC-imposed impediment.

Disappearing Insurance

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First it was health insurance, dysfunctional as it was, being replaced by the health coverage plan welfare program known as Obamacare.  Now auto insurance is under attack.

New York financial regulators have banned the use of education and occupation as factors in setting auto-insurance premiums….

Never mind that these are useful, if imperfect by themselves, correlates with driving skill and so of insurance risk. The companies accepting the risk transfer by selling a policy don’t get to know that information, they don’t get to assess the level of risk being accepted.  They can’t charge an accurate premium.  That hurts the driver as much or more than it does the insurer.

When insurers are not allowed to learn all the factors that go into the level of risk an insuree is seeking to transfer to an insurer, the policy being agreed ceases to be insurance.  New York’s auto “insurance” program isn’t yet approaching State welfare status, but it is ceasing to be insurance.

Individual Mandate and Risk Pools

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Louise Radnofsky and Stephanie Armour had a piece in The Wall Street Journal that looked at the small and shrinking impact of removing the Individual Mandate (or more accurately, removing the penalty Supreme Court-created tax imposed for not satisfying the IM) on the health coverage providing industry.  The piece is worth the read, but there was one remark quoted at the end that wants a particular look.

“Making the risk pool stable is a vital part” of keeping individual insurance premiums in line with the overall cost to cover a person insured through a larger group or employer, said Andy Slavitt, a top health official in the Obama administration.

You bet. However, in order to stabilize a risk pool, it’s necessary to understand risk pools. A healthy young man does not have the same risks as an elderly man or woman, and so he does not belong in either of their risk pools, either of them in his, and neither of those two in each other’s. A healthy woman of child-bearing age does not share the same risks as a post-menopausal woman, and neither share the same risks as a man of any age. None of those three groups belong in the same risk pool as any of the others.

Health-related risk pools, to be effective and accurate at estimating future health coverage costs and so arriving at reasonable fees for accepting the transfer of the risks involved, need to be reasonably homogeneous.  Belonging to the species homo sapiens is not sufficiently homogeneous.